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Excise Duty by 1st or 2nd Stage Dealer...!

Finance Professional


Hi..

My query is... A - is a manufacturer and B - is a Trader...

Both are located in one State say Maharashtra...

Now B" purchases materials from A' @ Rs.100/- + 10.30% + 4% VAT p/kg

and want to sell the same to C" who is located outside Mah- say Gujarat

@ Rs.120/- + 10.30% + 2% CST

Is this transaction is possible under Excise, b'se the manufacturer is charging

a duty of Rs.10.30/- and the Trader wants to charge the duty @ Rs.12.36/-

Can he make any payment by PLA [ of Rs.2.36/- ] ?

Reason behind this is that B" dont want to disclose its customer to A' and want

to sell the material at a higher value with a profit of Rs.20/- p/kg

Please explain....Thanks in Advance

 
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Advocate- Taxation & Corporate

Well Rajeev, certainly the dealer can sell goods at a higher price and there is no restriction on this under Central Excise law.

However, the dealer will only pass on that much duty as has been paid by the manufacturer. he is not required to pay any duty or pass on any higher duty to his buyer. The first part of the invoice will show that commercial value and excise duty will be Rs. 10.30 only (dont worry if it is not 10.3%, it need not be). At the bottom of the invoice, the dealer is required to give details of the manufacturer invoice on which he is passing on the credit. Dealer is not required to disclose anything to the manufacturer.


Total thanks : 2 times

 
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Finance Professional


Rajeshji, thanks for the comments...regret that i wont be able to get into this business, as it would be disclosing my purchase price to the customer [C]

However...thanks once again...

 
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Hi..

My query is... A - is a 1st Stage Dealer and B - is a Manufacturer...

Both are located in one State of West Bengal...

Now "B" purchases Oil from A' @ Rs.33 + 12.5% VAT

"A" gives two bills to "B".

1) Excise Bill (1st stage dealer bill) which shows Basic Rate @ Rs. 44 + 14.42% Excise, and gives details of Invoice  from Indian Oil @ Rs. 44 + 14.42%

2) VAT Bill @ Rs. 33 + 12.5% VAT.

"B" pays Rs. 33 + 12.5% only.

Can "B" claim Excise for 44x14.42% ? If not then for what rate can it claim.

Please explain....Thanks in Advance

P.S. The Excise Rate applicable on the prodcut is 14.42%

 
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Advocate- Taxation & Corporate

The dealer will take credit of duty paid by the manufacturer. further the dealer will pass on credit paid by the manufacturer. Any change in price, in between is irrelevant.

 
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Can we pass on ACD 4% also?

 
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Originally posted by :Rajesh Kumar
" Well Rajeev, certainly the dealer can sell goods at a higher price and there is no restriction on this under Central Excise law.
However, the dealer will only pass on that much duty as has been paid by the manufacturer. he is not required to pay any duty or pass on any higher duty to his buyer. The first part of the invoice will show that commercial value and excise duty will be Rs. 10.30 only (dont worry if it is not 10.3%, it need not be). At the bottom of the invoice, the dealer is required to give details of the manufacturer invoice on which he is passing on the credit. Dealer is not required to disclose anything to the manufacturer.
"

 
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ACCOUNTS MANAGER


we are 1st stage dealer in mumbai and we have branch at Gujrat  my query is whether we can transfer our excise duty to gujrat and what is our position whether we are a 1st stage dealer in gujrat or 2nd stage dealer in Gujrat

A.P.mathi

 
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Indirect Tax Executive


Hi Mr. Rajesh, 

 

""Well Rajeev, certainly the dealer can sell goods at a higher price and there is no restriction on this under Central Excise law.

However, the dealer will only pass on that much duty as has been paid by the manufacturer. he is not required to pay any duty or pass on any higher duty to his buyer. The first part of the invoice will show that commercial value and excise duty will be Rs. 10.30 only (dont worry if it is not 10.3%, it need not be). At the bottom of the invoice, the dealer is required to give details of the manufacturer invoice on which he is passing on the credit. Dealer is not required to disclose anything to the manufacturer.""




Can you please provide me with the info regarding the relevant Section / Rule / Notification  , which require the Central Excise dealer to disclose his procurement details??


Thanks in advance...

 
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glidor@gmail.com


Originally posted by : R.Sankaranarayanan

Hi Mr. Rajesh, 

 

""Well Rajeev, certainly the dealer can sell goods at a higher price and there is no restriction on this under Central Excise law.

However, the dealer will only pass on that much duty as has been paid by the manufacturer. he is not required to pay any duty or pass on any higher duty to his buyer. The first part of the invoice will show that commercial value and excise duty will be10.30 only (dont worry if it is not 10.3%, it need not be). At the bottom of the invoice, the dealer is required to give details of the manufacturer invoice on which he is passing on the credit. Dealer is not required to disclose anything to the manufacturer.""










Can you please provide me with the info regarding the relevant Section / Rule / Notification  , which require the Central Excise dealer to disclose his procurement details??




Thanks in advance...

http://www.caclubindia.com/forum/files_download.asp?msg_id=405042



download the file, try to fill it and understand what the dealer is likely to fill out and disclose in dealers invoice. 

 
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